Alibaba’s chipmaking arm sets up subsidiary in Shanghai

Alibaba has registered a Shanghai subsidiary of its recently announced chipmaking arm Pingtouge, as Chinese companies heed the government’s calls to develop homegrown core technologies.

According to public records, the Shanghai-based company was formed last month in the Shanghai Free Trade Zone with registered capital of RMB 10 million ($1.5 million).

The company has so far been reluctant to comment on its Shanghai investment, though the registered address of the newly formed firm is that same as that of chipmaker C-SKY Microsystems, which Alibaba fully acquired in April.

Records show that the company is 100% owned by Alibaba’s Damo Academy, the company’s research and development unit. The research affiliate was launched in 2017, with Alibaba investing RMB 100 billion for developing leading technologies, including artificial intelligence and quantum computing, over the course of three years.

In September, Alibaba CTO Jeff Zhang announced Pingtouge, which translates to honey badger, at the company’s Cloud Computing Conference in Hangzhou, capital of the eastern Chinese province of Zhejiang. The company is expected to release its first neural network chip, the AliNPU, by the middle of 2019.

In November, the e-commerce titan attended the opening event of the Shanghai Integrated Circuit Design Industrial Park as one of the resident companies. The park’s aim is to promote the country’s national chip development strategy.

Alibaba has made investments in several other chip companies, including China-based Cambricon, Kneron, ASR, and DeePhi, as well as California-based Barefoot Networks.

Numerous other Chinese tech companies have answered the call to develop homegrown core technologies. Appliance manufacturer Gree established a wholly owned subsidiary focusing on chip development for its products including air conditioners.

Hangzhou-based Rokid, specializing in robotics research and AI development, earlier this year unveiled its voice-focused Kamino18 AI chip, which the company claims can reduce equipped devices power consumption by 30% to 50%.